Liberalizing foreign investments by pension funds: Positive and normative aspects
The paper evaluates the economics of foreign investment regulation for pension funds, with a focus on developing countries, where fully-funded pension systems are being started de novo. The analysis produces three observations. First, the benefits of global portfolio diversification apply particularly to developing-country pension assets because the volatility of asset returns is high while the risk tolerance of pensioners is low. Second, restrictions of foreign investment by domestic pension funds can hardly be justified on grounds of financial-development arguments: cross-country evidence which little support for the claim that the accumulation of pension assets would provide strong externalities for financial development. Moreover, the home bias generally observed in pension fund investment should translate into sufficient potential demand for domestic financial assets so as to deepen markets and develop the institutional infrastructure. Third, a case for initial localisation ... Ce document évalue l’économie de la réglementation des investissements à l’étranger des caisses de retraite, notamment pour les pays en développement (PED) où les systèmes de retraite par capitalisation sont récents. L’analyse conduit à trois observations. Premièrement, elle montre que les produits d’épargne retraite des PED peuvent tout particulièrement bénéficier d’une diversification des portefeuilles au niveau mondial ; en effet, les rendements des actifs sont très volatils alors que les retraités sont très vulnérables. Deuxièmement, l’argument du développement financier peut difficilement justifier les limitations à l’investissement étranger par les fonds de pension nationaux : cette étude internationale ne confirme pas vraiment l’idée selon laquelle l’accumulation de produits d’épargne retraite conduirait à des retombées positives importantes pour le développement financier. De plus, le biais national généralement observé dans les investissements de caisses de retraite ...
(This abstract was borrowed from another version of this item.)
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Karen K. Lewis, 1994. "Puzzles in International Financial Markets," NBER Working Papers 4951, National Bureau of Economic Research, Inc.
- Joshua Aizenman & Pablo E. Guidotti, 1990.
"Capital Controls, Collection Costs, and Domestic Public Debt,"
NBER Working Papers
3443, National Bureau of Economic Research, Inc.
- Aizenman, Joshua & Guidotti, Pablo E., 1994. "Capital controls, collection costs and domestic public debt," Journal of International Money and Finance, Elsevier, vol. 13(1), pages 41-54, February.
- Levine, Ross & Zervos, Sara, 1996.
"Stock Market Development and Long-Run Growth,"
World Bank Economic Review,
World Bank Group, vol. 10(2), pages 323-39, May.
- Lewis, K.K., 1994. "Puzzles in international Financial Markets," Weiss Center Working Papers 94-7, Wharton School - Weiss Center for International Financial Research.
- Robert G. King & Ross Levine, 1993.
"Finance and Growth: Schumpeter Might Be Right,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 108(3), pages 717-737.
- King, Robert G. & Levine, Ross, 1992. "Financial indicators and growth in a cross section of countries," Policy Research Working Paper Series 819, The World Bank.
- Demirguc-Kunt, Ash & Levine, Ross, 1996.
"Stock Market Development and Financial Intermediaries: Stylized Facts,"
World Bank Economic Review,
World Bank Group, vol. 10(2), pages 291-321, May.
- Demirguc-Kunt, Asli & Levine, Ross, 1995. "Stock market development and financial intermediaries : stylized facts," Policy Research Working Paper Series 1462, The World Bank.
- Helmut Reisen & John Williamson, 1994. "Pension Funds, Capital Controls and Macroeconomic Stability," OECD Development Centre Working Papers 98, OECD Publishing.
- Michael P. Dooley, 1995.
"A Survey of Academic Literature on Controls over International Capital Transactions,"
NBER Working Papers
5352, National Bureau of Economic Research, Inc.
- Michael P. Dooley, 1995. "A Survey of Academic Literatureon Controls Over International Capital Transactions," IMF Working Papers 95/127, International Monetary Fund.
- De Gregorio, Jose & Guidotti, Pablo E., 1995.
"Financial development and economic growth,"
Elsevier, vol. 23(3), pages 433-448, March.
- Liliana Rojas-Suárez & Steven R. Weisbrod, 1996.
"Building Stability in Latin American Financial Markets,"
Research Department Publications
4028, Inter-American Development Bank, Research Department.
- Liliana Rojas-Suárez & Steven R. Weisbrod, 1996. "Building Stability in Latin American Financial Markets," IDB Publications (Working Papers) 5921, Inter-American Development Bank.
- repec:idb:wpaper:320 is not listed on IDEAS
When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:25:y:1997:i:7:p:1173-1182. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.